Sirius seeks $600m for troubled Yorkshire mine project

Shares of Scarborough-based Sirius Minerals plc, the firm behind the controversial $5 billion fertilizer mine in North Yorkshire, rose about 9% on Monday as it outlined a new two-stage development plan for the mine.

Sirius said “strategic partner and financial investor processes” were underway with the aim of securing about $600 million of “initial scope” funding “with various parties engaged and assessing information.”

In September, Sirius shares fell more than 50% after it said it would slow down the development of the mine — which supports about 1,200 jobs — and cancel a planned $500 million bond sale.

The $500 million bond sale was required to unlock a $2.5 billion financing package for the project.

On Monday, Sirius CEO Chris Fraser said in a statement: “Our focus during the first phase of the strategic review has been to reassess the best ways to unlock the value of our project for our shareholders, our community, the UK, and our customers all around the world.

“Our analysis has identified a two-stage development plan that enables us to achieve the key de-risking milestone of first polyhalite, when the service shaft reaches the polyhalite ore body, with an upfront capital requirement of ~$600 million.

“The additional works required to reach an installed and ramped up production capacity of 10 Mtpa contemplates up to US$2.5 billion of capital expenditure.

“We are in discussions with potential strategic partners and debt investors with the aim of securing the best route to finance our revised initial scope of work and will update the market and our stakeholders on the progress of those when appropriate. 

“The value of Sirius is unlocked by reaching production and delivering POLY4 to our customers around the world.

“This approach allows us to achieve that with less upfront capital while retaining the significant return opportunity it presents for our shareholders and stakeholders.

“I would like to thank our employees, contractors and partners for their continued focus and commitment, and recognise that the progress achieved on the ground in recent months remains a source of huge inspiration for the whole team.”